Greece tax for expats:
the 7% flat tax on foreign pensions.

The American asterisk — why 5B doesn't save as much as it looks

The 7% rate sounds transformative — and for a Canadian or British retiree, it is. For Americans, the maths is different. The US taxes its citizens on worldwide income regardless of where they live. The saving clause in the US–Greece treaty preserves that right — and unlike most modern US treaties, this 1950-vintage agreement has no exceptions to the saving clause at all.

Here's what happens in practice: you elect 5B and pay 7% to Greece on your foreign income. You file your US return and claim the 7% as a Foreign Tax Credit. But your US marginal rate on the same income is 22–37%. The FTC offsets only 7 percentage points of it. The IRS collects the difference.

The result: if your US rate on pension income is 24%, you pay 7% to Greece + ~17% to the IRS = ~24% total. You haven't saved money — you've redirected 7% from Greece to the US and still paid full US rates overall. 5B mostly changes which country gets your tax dollars, not how many tax dollars you pay.

Social Security

Under the US–Greece treaty, both countries may tax Social Security benefits. Greece taxes the full amount — at 7% under 5B, or at progressive rates without it. The US typically taxes up to 85% of benefits depending on combined income. You claim the Foreign Tax Credit on whichever side has the lower bill.

The US–Greece totalization agreement (since 1 September 1994) prevents double social security contributions during working years and allows combining coverage periods to qualify for benefits in either country.

401(k) and Traditional IRA withdrawals

The treaty's pension article (Art. XI) says private pensions derived from one state by a resident of the other shall be exempt from tax in the source state — meaning only Greece should tax them. But the saving clause overrides this for US citizens: the US retains the right to tax these distributions regardless. And this treaty has no exceptions.

Under 5B, Greece taxes these withdrawals at 7% as foreign-source income. The US also taxes them as ordinary income. You claim FTC on the smaller bill. In practice, the 7% Greek rate is almost always below the US rate, so the FTC wipes out any additional Greek liability — but the IRS collects the difference up to the full US rate.

Roth IRA and Roth 401(k) — the grey area

If Roth withdrawals qualify under 5B: Greece taxes them at 7%. Since the US doesn't tax qualified Roth withdrawals, there's no FTC available — you pay 7% to Greece with no offset. This is better than Greek progressive rates (up to 44%) but it's not zero.

If they don't qualify: standard Greek progressive rates apply to the growth portion. Get a ruling from AADE before you elect.

The timing play: complete Roth conversions before establishing Greek tax residency. While you're still US-only resident, conversions are taxed at US rates and future qualified withdrawals remain tax-free in the US.

Government and military pensions

Article VIII of the treaty gives the US exclusive taxing rights on government service pensions — FERS, CSRS, military retirement pay, and state/local government pensions. Greece cannot tax them. You declare them on your Greek return with the treaty exemption noted, but no Greek tax is due.

Note: government pensions don't benefit from 5B because Greece doesn't tax them — there's no Greek tax to replace with the 7% rate. They remain taxable only in the US at standard US rates.

Private employer pensions (DB and DC)

Same treatment as 401(k)/IRA under Article XI: taxable only in Greece in principle, but the saving clause means the US taxes its citizens too. FTC resolves the overlap. Under 5B, Greek tax is 7%.

US state taxes — the exit matters

Nine states have no income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. If you're already in one of these, there's no state-level complication.

The "sticky states" to watch are California and New York. California's Franchise Tax Board actively audits expats and challenges residency changes. New York focuses on your "intent to return." Clean your ties before you leave. Federal protection under 4 U.S.C. §114 generally prohibits states from taxing retirement income of former residents, but not all income types are covered.

What you still owe the US — the full picture

5B changes everything for Canadians

Unlike Americans, Canadians who cease tax residency generally stop filing Canadian returns (except for Canadian-source income). There's no saving clause that lets Canada tax worldwide income of former residents. This means Article 5B delivers what it promises: 7% total on all foreign income for 15 years, full stop.

For a Canadian retiree with CAD $60,000 in pension income, the comparison is stark. Standard Greek progressive rates: roughly 20–26% effective rate. Under 5B at 7%: roughly one-third of that. Plus: any Canadian withholding on amounts above the CAD $15,000 treaty threshold is credited against the small Greek liability. 5B is the single biggest tax planning tool available to Canadian retirees in Europe.

CPP / QPP

Under Article 18 of the Canada–Greece treaty, Canada may withhold on periodic pension payments but must exempt the first CAD $15,000 per year. On amounts above that, withholding is capped at the lesser of 15% or the rate based on worldwide income. Most CPP payments fall near or below the CAD $15,000 threshold, so Canadian withholding is often zero or minimal.

Greece taxes the full CPP/QPP amount — at 7% under 5B. Credit for any Canadian tax withheld applies under Article 22.

OAS (Old Age Security)

Same treaty treatment as CPP — periodic payments subject to the 15%/CAD $15,000 threshold. But watch the OAS clawback: if worldwide net income exceeds CAD $93,454 (2025 threshold, adjusted annually), OAS begins to be clawed back. Full clawback at about CAD $152,000 (ages 65–74). File Form T1136 (OASRI) annually.

OAS continues indefinitely abroad with 20+ years of Canadian residence after age 18. Under 20 years: the social security agreement allows combining Greek insurance periods to meet eligibility.

RRSP / RRIF withdrawals

Canada withholds 25% on RRSP lump-sum withdrawals from non-residents — and the treaty does not reduce this rate for lump sums. For RRIF periodic withdrawals, the treaty-reduced rate of 15% on amounts above CAD $15,000 applies.

Strategy: convert your RRSP to a RRIF before emigrating. This enables periodic withdrawals at the reduced 15% treaty rate instead of the 25% flat rate on RRSP lump sums.

Section 217 election: non-residents can elect to file a Canadian return (Form NR5 in advance). If your marginal tax as a Canadian resident would be lower than the 25% flat withholding, the excess is refunded. Due by June 30.

Under 5B, Greece taxes the full withdrawal at 7%. The Canadian withholding (15–25%) exceeds the Greek tax (7%), so no additional Greek tax is typically due — but the excess Canadian withholding cannot be credited against other Greek obligations.

Employer DB pensions

Article 18 applies: Canada withholds at 15% on periodic payments above the CAD $15,000 aggregate threshold. Note that the CAD $15,000 threshold is aggregate across all Canadian periodic pension payments, not per source.

Unlike many Canadian treaties, the Canada–Greece convention does not give Canada exclusive taxing rights on government employee pensions. Federal, provincial, and municipal government DB pensions are treated the same as private pensions under Article 18.

TFSA — Greece doesn't recognise it

Departure tax — the hidden bill

Under Section 128.1(4) of the Income Tax Act, when you cease Canadian residency you are deemed to have disposed of all property at fair market value. Capital gains are taxable in Canada.

You can elect to defer the tax via Form T1244 (due April 30 of the year after emigration), but security may be required. If you've been a Canadian resident for 60+ of the last 120 months, all worldwide assets are caught.

Social security agreement

Canada and Greece have had a social security agreement since 1983 (revised 1997). It covers CPP/QPP and OAS, allows totalization of contribution periods between countries, and ensures benefits are portable. Greek insurance periods count toward Canadian OAS/CPP eligibility.

5B + the old treaty = 7% on nearly everything

The UK–Greece treaty is almost as old as the US–Greece one (signed 1953 vs. 1950), but for retirees the combination with 5B works far better. The UK doesn't tax its citizens on worldwide income after they leave — once you're not UK tax resident, the UK can only tax UK-source income, and the treaty exempts most pension types from UK tax entirely. Under Article VII, private pensions and annuities derived from the UK are exempt from UK tax for a Greek resident.

That means: NT code in place, no UK tax on your private pension. 5B elected, 7% Greek tax on the same pension. Total tax: 7%.

UK State Pension

Taxable only in Greece under Article VII. Apply for the NT code — payments arrive gross. For 2026/27, the full new State Pension is £241.30/week (£12,548/year), a 4.8% triple lock increase.

Crucially, this annual uprating is protected for UK pensioners in Greece because Greece is an EU member state and the UK-EU Trade and Cooperation Agreement preserves pension uprating in EU/EEA countries. This is a major advantage over "frozen rate" countries like Australia, Canada, and New Zealand, where the UK State Pension is frozen at the rate when you left.

Under 5B, the State Pension is taxed at 7% in Greece. At current exchange rates, that's roughly £878/year in tax on the full State Pension — a modest price for triple-lock-protected income and EU residency.

Workplace pensions (DB and DC)

Article VII: taxable only in Greece. Applies to both defined benefit (final salary/career average) and defined contribution schemes. Apply for the NT code to receive payments gross. Under 5B: 7%.

SIPP and personal pension drawdown

Article VII again: SIPP drawdown payments are "pensions and annuities" — taxable only in Greece. NT code process is the same. Under 5B: 7%.

The 25% tax-free lump sum (PCLS) — take it before you move

While you're still UK tax resident, the PCLS is genuinely tax-free — no UK tax, no Greek tax (you're not resident yet). Take the 25% before you establish Greek tax residency. Under 5B the cost is only 7%, which is modest — but zero is better than 7%.

NHS pensions — not what you'd expect

Despite being a public-sector pension, most NHS pensions are not classified as government service pensions under the treaty. Article VIII applies only to pensions paid in respect of services rendered in the discharge of governmental functions. The NHS is treated as carrying on a business (healthcare provision), so NHS pensions fall under Article VII — taxable only in Greece, and eligible for 5B at 7%.

Government pensions — civil service, military, police

Government pensions don't benefit from 5B because Greece doesn't tax them — there's nothing to replace with the 7% rate. They remain taxable only in the UK.

Getting the NT code — step by step

To stop HMRC deducting tax from your pension at source, you need an NT (No Tax) code:

• Complete the DT-Individual form (available from HMRC)
• Obtain a Tax Residency Certificate from AADE in Greece
• Submit both to HMRC
• Allow 12–16 weeks for processing
• Once issued, your pension provider pays gross — no UK tax deducted

Until the NT code is in place, HMRC will deduct tax at the default rate. You can reclaim the overpayment through your UK Self Assessment return.

Voluntary National Insurance — the 2026 change

Each qualifying NI year adds about 1/35th to your State Pension entitlement — roughly £358/year in pension. At £923/year in contributions, the payback period is under 3 years. For most people with gaps, it's still worth it.

Healthcare — the S1 form

UK State Pension recipients can get an S1 form from NHSBSA, which transfers healthcare cost responsibility from the UK to Greece. Register the S1 with EOPYY (the Greek social insurance body) for access to the ESY public healthcare system. Allow 4–12 weeks for NHSBSA to issue the S1. The UK Global Health Insurance Card (GHIC) covers emergency treatment during temporary visits back to the UK.

No treaty — but 5B still works

Australia and Greece do not have a comprehensive income tax treaty in force. Without a treaty, there's no formal bilateral mechanism to prevent double taxation — relief depends on each country's domestic rules. Australia's unilateral foreign income tax offset may provide some relief on Australian-source income taxed by both countries.

The good news: Article 5B doesn't require a treaty. It's a unilateral Greek regime — any qualifying foreign pensioner can elect it regardless of treaty coverage. Greece requires only that you transfer your tax residence from a country with which it has an "administrative cooperation" agreement, which covers Australia. For Australians, 5B is particularly valuable because super withdrawals go from 0% (Australia, post-60) to just 7% (Greece under 5B) instead of up to 44% at standard rates.

Age Pension

The Australian Age Pension is payable overseas indefinitely, but the rate may be reduced after 26 weeks based on your Australian Working Life Residency (AWLR). If your AWLR is 35 years or more, you receive the full rate. Below 35 years, the pension is proportional: (AWLR months / 420) x maximum rate.

Several supplements are lost or reduced overseas: Rent Assistance stops after 26 weeks, Energy Supplement after 6 weeks, and Pension Supplement drops to the basic rate.

The social security agreement (since 2008) allows combining Australian and Greek insurance periods to qualify for benefits in either country.

Under 5B, Greece taxes the full Age Pension at 7%. Without a treaty, Australia may also tax any Australian-source component — the foreign income tax offset may provide partial relief.

Superannuation — the 5B opportunity

This is the biggest issue for Australian retirees. In Australia, superannuation withdrawals after age 60 from a taxed fund are completely tax-free — both lump sums and income streams. Greece doesn't recognise this.

Without 5B: standard Greek progressive rates up to 44%. With 5B: 7% flat. On a AUD $100,000 super withdrawal, you're looking at roughly AUD $7,000 in Greek tax under 5B versus AUD $15,000–25,000 at standard rates.

Because Australia doesn't tax the withdrawal, there's no foreign tax credit to offset the Greek tax. You pay 7% to Greece, full stop. But 7% is a small price for access to EU residency, healthcare, and the Greek lifestyle — and it's vastly better than what you'd face without 5B.

Self-managed super funds (SMSF)

If the SMSF fails these tests, it loses its complying status and is taxed at 45% instead of the concessional 15%. Consider rolling your SMSF into a retail or industry fund before moving permanently, or appointing an Australian-resident trustee with appropriate powers.

CGT on departure — don't forget your Australian home

Australia's CGT Event I1 deems all assets (except "taxable Australian property," primarily real estate) to be disposed at market value when you cease residency. You can elect to disregard the event, but your assets then become Taxable Australian Property and the 50% CGT discount is apportioned based on days as a resident vs. total ownership.

The main residence exemption trap: from 1 July 2020, non-residents at the time of sale generally lose the main residence CGT exemption. If you plan to sell your Australian home, do it before leaving to preserve the full exemption.

The UK State Pension angle

Many Australian retirees also hold UK State Pension entitlements from years working in Britain. In Australia, the UK State Pension is frozen at the rate when you left the UK — no annual increases. In Greece, it's uprated annually under the triple lock (because Greece is an EU member state). Moving to Greece effectively unfreezes your UK pension. Under 5B, both your Australian super and your UK pension are taxed at 7%.

The timing play for Australians

Because super withdrawals go from 0% (Australia) to 7% (Greece under 5B) or up to 44% (Greece without 5B), the pre-residency window matters:

• Take super lump sums while still Australian tax resident (0% after age 60)
• Sell the Australian home before departure (preserves main residence exemption)
• Crystallise capital gains while still in Australia (50% discount available)
• Roll SMSF into a retail fund if maintaining compliance from abroad is impractical

5B changes everything for South Africans

Like Canadians and Brits, South Africans who leave SA generally stop filing SA returns on worldwide income — once SARS confirms you as non-resident, only SA-source income is taxed. There's no saving clause that lets SA tax former residents on worldwide income. This means Article 5B delivers what it promises: 7% total on all foreign income for 15 years, full stop.

For a South African retiree drawing ZAR 60,000/month from a retirement annuity, the comparison is stark. Standard Greek progressive rates: roughly 20–34% effective. Under 5B at 7%: less than a quarter of that. The combination of the treaty (Greece gets exclusive taxing rights on private pensions) and SA's clean non-resident exit makes Greece one of the most attractive destinations for SA retirees in Europe.

Private pensions — retirement annuities, provident and preservation funds

Article 18 of the SA–Greece treaty gives Greece exclusive taxing rights on private pension income paid to a Greek resident. SA should not withhold on periodic pension payments once you've confirmed non-resident status and the fund administrator has your updated tax details.

Under 5B, Greece taxes the full amount at 7%. Without 5B, standard progressive rates apply (9–44%). The 5B route is overwhelmingly better for virtually every SA retiree.

GEPF — government pensions stay in SA

Article 19 gives South Africa exclusive taxing rights on GEPF pensions paid in respect of government service. Greece cannot tax them. You declare them on your Greek return with the treaty exemption noted, but no Greek tax is due. GEPF pensions don't benefit from 5B because Greece doesn't tax them — there's nothing to replace with the 7% rate.

Tax emigration — the three-year wait

Since 1 March 2021, SARS — not the Reserve Bank — determines your non-resident status for retirement fund purposes. The old "financial emigration" through SARB was abolished and replaced with tax emigration through SARS. To withdraw your retirement annuity or preservation fund before retirement age:

• Complete tax emigration through SARS (cease to be SA tax resident)
• Remain non-resident for 3 uninterrupted years
• Obtain a Non-Resident Tax Status Confirmation Letter from SARS
• Apply for a tax directive from SARS for the withdrawal

The withdrawal is taxed in SA under the retirement lump-sum tax tables: 0% on the first ZAR 550,000, then 18%, 27%, and 36% on higher amounts. From 11 April 2025, SARS tightened the tax directive process — a Non-Resident Tax Status Confirmation Letter is now mandatory (the old Emigration TCS PIN route was discontinued).

The two-pot system — from 1 September 2024

South Africa's retirement system was restructured into three components:

Under 5B, any savings-component withdrawal is foreign income taxed at 7%. Without 5B, it's at Greek progressive rates up to 44%.

Exchange control — getting money out of SA

• Single Discretionary Allowance (SDA): ZAR 2 million per calendar year — doubled from ZAR 1 million in March 2026. No SARS approval needed.
• Foreign Investment Allowance (FIA): ZAR 10 million per calendar year with a SARS Tax Compliance Status (TCS) PIN.
• Non-resident transfers: once SARS has confirmed non-resident status, retirement fund lump sums and other capital can be transferred via your authorised dealer (bank) with the appropriate tax clearance.

Regular pension/annuity income (not lump sums) can be transferred offshore without using your SDA or FIA allowances — these are current-account transfers, not capital movements.

What you still owe SARS

The general framework

Greece has tax treaties with over 50 countries. The pension provisions typically follow the OECD Model Convention: private pensions are taxable only in the country of residence (Greece), while government pensions are often taxable only in the paying state. But the details vary treaty by treaty.

Article 5B is the key differentiator. Unlike Portugal's defunct NHR or Italy's location-restricted 7% regime, Greece's 7% flat tax is open to any qualifying foreign pensioner with no restriction on where in Greece you live, and it lasts 15 years. The main eligibility requirement: you must not have been Greek tax resident in 5 of the previous 6 years, and you must prove you receive pension income from abroad.

We're adding detailed pension guides for more source countries. If yours isn't covered yet and you'd like specific guidance, get in touch and we'll connect you with a cross-border tax adviser who works with your nationality in Greece.